ABSTRACT
This chapter illustrates the mechanisms by which minorities can be isolated from good job opportunities using unique data from one employer. It is common for scholars interested in race and poverty to invoke a lack of access to job networks as a reason why minorities face difficulties in the labor market. Minorities have been found to be more likely to have obtained their job through networks than nonminorities. A key component of understanding whether minorities are cut off from employment opportunities is to understand why they may be underrepresented in networks that lead to good jobs. If employers avoid hiring through networks, being well-represented in the pool of referred applicants is bad news for minorities. The effect of screening processes on minorities' access to desirable jobs depends on the employer's attitude towards referrals. The regression results show that there is little evidence of an employer's preference either for, or against, candidates who were referred to the company at hiring interface.
